Peak Shale: Is the US Fracking Industry Already in Decline?

In 2016, lower oil prices led to an overall drop in production for shale companies, which use horizontal drilling and fracking to extract oil and gas from shale formations such as the Marcellus and Permian. This was one of the few relatively positive financial periods for an industry plagued by high costs and low returns (although it still lost money in 2016). But the industry shouldn’t get complacent, warned Robert Clarke of energy industry research and consulting group Wood Mackenzie . Cracks already are starting to emerge in the optimistic forecasts of how much these shale formations can produce, which is a bad sign for turning around the industry’s struggling finances. “It was only the best rigs, with the most experienced crews, drilling the best rock at the lowest service costs,” which were doing well in 2016, said Clarke at the 2018 Energy Information Administration (EIA) annual conference in […]